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Global central banks have shown that they are willing to adopt negative interest rate policies to stimulate stagnate growth. Consequently, in this new so-called NIRP environment, gold exchange traded funds could continue to shine.

Given the ongoing NIRP environment, with European and Japanese central banks cutting benchmark rates deeper into the red to promote growth, the World Gold Council believes investors may turn to gold bullion as a more stable store of wealth.

“History shows that, in periods of low rates, gold returns are typically more than double their long-term average,” according to a recent World Gold Council research note.

With government bonds depressed due to the negative yield environment, fixed-income assets would be less effective at hedging market risks and may appear overbought in some areas – about 30% of high quality sovereign debt, or over $8 trillion, is trading with a negative yield and almost an additional 40% with yields below 1%, according to the World Gold Council.